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AgLife: On with the job

None of us like having to admit to making a mistake. 

My latest was in an interview with a UK-based Black Sea grains analyst, Mike Lee. 

I began our Country Today interview on the current situation for grain growers in Ukraine by saying: “It’s been nearly a year since Russia invaded Ukraine.”

He interrupted. 

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“Well no, actually it’s two years,” Mr Lee said. 

I was embarrassed and staggered all at once.

How could we be two years into the conflict? 

Why are we hearing so little about it? 

And from Country Today’s perspective, what impact is it having on one of the largest wheat-exporting areas in the globe? 

To put it into perspective, Ukraine produces more than three times the amount of wheat produced in Australia.

During the first year of the conflict, according to Mr Lee, and despite direct attacks on farms and machinery, land mines, and missiles, Ukraine’s farmers planted about 70 percent of their spring crops — including corn, sunflower, soy and barley. 

Most of Ukraine’s wheat was planted in October, so that was in the ground before the Russian invasion.

Back then, Mr Lee said: “If the war stopped tomorrow, it will take years before Ukraine’s agriculture and grain exporters get back to pre-war levels.”

Two years on and he has a different and rather poignant view.

“I think I’m a bit more optimistic. You have the areas where the military activity is taking place, you have large areas that have been mined, and, obviously, that’s going to take time to repair — but fundamentally, the farming systems are still in place, the infrastructure is there,” he said.  

“There have been some attacks on grain storage facilities but I think farming would be fully operational if the war was to stop.”

The Russian invasion, as it sits today, has taken over a portion of land in the east of Ukraine so it’s about 10 percent, but in the west and central Ukraine, farming is still operational. 

“But there are still some issues with supplies of inputs and sale of produce and, of course, there’s still military activity taking place all over the country,” Mr Lee said.

“Farmers being farmers, they have a tendency just to go farming whatever the conditions. 

“Despite all the adversities, disadvantages and problems, farming has continued — albeit, under extreme circumstances.”

In fact, the weather favoured the farmers and yields from last year’s harvest were strong, despite the lack of inputs such as fertiliser. 

But that hasn’t translated into profits. 

Russia has cashed in on Ukraine’s productivity. 

“The big problem has more to do with cash flow… We have an issue on whose balance sheet the grain sits in,” Mr Lee said. 

“In the occupied regions of Ukraine, there’s still grain coming out of there, it just ends up on the Russian balance sheet.”

It gives a whole new perspective on the often quoted, ‘farmers are very resilient’.

The entire January 31, 2024 edition of The Weekly Advertiser is available online. READ IT HERE!

The entire January 31, 2024 edition of AgLife is available online. READ IT HERE!